Hi all,

I am just wondering whether you leased or purchased your MINI and the reason for your decision.

I purchased my MINI because I put very few miles on the car, so my MINI shouldn't depreciate as much. Although, I don't intend to sell the car anytime soon (if ever), if I do sell her, I figured that the car will have depreciated by a lesser amount than the total payments and down payment that I would have had to make had I leased. Plus, I like the idea of owning the car rather than just renting it.
(The only reason I would sell my MINI is if she becomes too expensive to maintain after the free maintainance period.)

 

My wife leased a car a number of years ago and never again. I haven't taken delivery of my MCS yet but I'm purchasing also. I was interested in the other option that they offer, somewhat similar to an ARM mortgage loan. Would be interested in anyone who went that route.

 

Leasing is for the insanely wealthy and business owners.

As a business owner you can take advantage of every possible tax break/write off when you lease a vehicle.... as it is more like "renting" .

If you purchase the vehicle for your business you cannot write off the interest, but you can write off the milage and other expenses tied in with owning it.

 

Hmmmmm? My tax guy says that you can take into consideration the interest payments on a purchase if you are self employed (the WIFE).

 

Well, if you do that, you HAVE to do that for the duration of the LOAN... and you cannot take the Milage deductions. By taking the interest deduction, you have to rely on the car to depreciate... and it won't be a huge deduction in it's first two years in service. The Milage Deductions are perfect for anyone who purchased a car... 36.5 cents per mile! WOOO WOOO! Also keep in mind, that if you purchased product for that car after you signed your loan paperwork, you can deduct that...
For Example-

My Mini -

Window Tinting = 100% deduction (why?) Because my small business is MINI related... wether I pull a profit or not, this MINI is rollign advertisement for my business.
New Wheels and Tires = 100% Deduction (why) Same reasons
Anything I add = 100% deduction.

Ask the Tuners, I'm sure they deduct all they can when pieicign together their SuperMini's.

Good Luck!


It made our car poke into profit range.

 

Businesses can write off anything that is necessary to the operation of the business, including interest on an automobile.
The advantages to a lease over a purchase in the USA are:
1. Less cash out of pocket to take delivery.
2. Lower monthly payments all things being equal.
3. Simpler tax accounting; if the car is used by a self employed person for business and personal use a percentage of the monthly payment can be charged off as a business expense. Businesses can deduct the whole lease payment but if the car is used for any personal usage by the prospective driver there can be a tax liability for any personal use.
If you plan on getting a new automobile every three years or so and you are not a high mileage driver, leasing is not a bad way to go. If you plan to keep the car or drive more than 15,000 miles a year then a purchase may be the better plan. At the present time the MINI has a high residual value, which is the value the leasing company puts on the vehicle at the end of the lease, so all things being equal the lease payments would be lower then on most equally priced competitor’s cars. With the high mark-ups that many dealers are enjoying now you need to know what the capitalized cost on the lease is, don’t just look at the monthly payment. It takes four items to figure a lease: 1 Price of the car (capitalized cost). 2. Residual value (value of car at the end of the lease, the price you would pay if you wished to keep the car at lease end) 3. Term of the lease in months. 4. Money factor (the amount charged for use of the money, expressed as a factor, not to be confused for an interest rate, but in essence the same thing)

 

You seem to be knowledgeable, what do you know about the MINI-Select program?

 

No, I am not familiar with the MINI-select program. However, in my lengthy post on leases I failed to mention one important element in figuring a lease, the amount of depreciation. That is figured by subtracting the residual value from the capitalized cost and dividing that number by the term. That is what you pay each month in your payment PLUS the use of the money charge determined by the money factor, plus state sales tax on both. The residual is always a percentage of the MSRP, not what you paid for the car.

 

I'm not too sure about the MINI-Select program but it seems similar to a program offered by VW which I am currently a victim of- it's a buyer's option lease. i leased my new 99 Golf thinking it would be a great idea to drive a new car every 3 years- big mistake. when it came time to return the car i had the option of refinancing what i still owed (similar to MINI-select). since i had gone over the milage on the car and there was some average wear-and-tear i decided to refinance- the fact that i had no $$$ to put down on a new lease or loan was also a deciding factor. The car is now 4 years old with 50k+. AND i still owe over $8,000! (more than the trade-in value of the car, though I hope my MINI dealer will help me bring the loan to zero with the trade-in). unless you can get a great tax deduction as discussed above, I recommend going for financing. MINI-select sounds too much like the VW program that I am losing $$$ with now...

 

THANKS MAN!

You covered everything I could not!
As a small business startup... every moment in my mini is a write off... there is no personal use in it.. and if there is... it's still a write off due to the Advertisement on it.

The Lease option is a great way for a business to save $.

Thanks for your post!

 

I've been asking about the MINI-select option for financing the car... the information that I got from my salesguy was that it's for people with the very best of credit. Me being 23 and just out of college... eh. I'm most likely not going to qualify for the deal, even though I have a 'perfect' record.

 

It's true, most lease options are made available to people with a Good Credit History

 

To qualify you must be a "Tier A1" customer, that is, a customer with pristine credit history, good debt to income ratio and a beacon score of 700+ points.